Prop Firm Spreads and Execution Skewing Strategy Validity
Been running simulations on a few prop firm platforms versus my own live broker data, and the spread differential is becoming a real headache. I'm seeing consistent 0.5-1.0 pip wider spreads on major pairs during active hours with several firms, and execution slippage seems to compound it. For strategies relying on tight entries/exits or scalping, this difference is effectively invalidating the edge I've developed on my own accounts. It’s not just the advertised commissions; it’s the effective cost per trade when you factor in the liquidity provided by their tier one partners. Anyone else finding this to be a significant hurdle when evaluating firms, or have you adapted your strategy to account for the wider bid-ask? It makes passing challenges far more capital intensive than it needs to be, and managing an actual funded account even trickier.
That's a critical point you're raising. Have you tried backtesting your strategies using the actual historical spread data provided by the prop firms themselves, or are you still relying on your live broker's data for the initial simulation? It might be tedious, but it could offer a more accurate picture of strategy validity within their environment.